Gold prices in the UAE experienced a notable surge at the market opening on Tuesday, recovering more than Dh1 per gram after a slight dip of Dh2 per gram on Monday.
According to data from the Dubai Jewellery Group, the benchmark 24K gold was trading at Dh245.25 per gram, marking an increase from Monday’s closing value of Dh244.0 per gram.
Other gold variants followed suit, with 22K at Dh227.0 per gram, 21K at Dh219.75, and 18K at Dh188.5.
The surge in gold prices can be attributed to a range of factors prominently influenced by the optimistic non-farm payroll data for January in the United States.
Market analyst Rania Gule from XS.com explained that the price drop on Monday was a reaction to the optimistic employment data, which fueled expectations that the Federal Reserve would maintain interest rates within the 5.25 to 5.50 per cent range at its upcoming policy meeting in March.
Gule emphasized, “The strong job market data reinforces the argument for maintaining higher interest rates until the end of spring this year.
The strong demand for labour and the high average wages offered by employers in the US suggest bright prospects for demand.
This also indicates a continuation of the high inflation environment, requiring interest rates to remain elevated to prevent further increases.”
While gold prices faced pressure, Gule pointed out that expectations for US bond yields and the Dollar Index have significantly improved.
As indicated by the strong job market and the potential for sustained inflation, the current economic landscape has led to speculation that the Federal Reserve will opt to keep interest rates at their current levels, providing support for gold prices.
At 9:35 am UAE time, spot gold showed a remarkable increase of 15 per cent, reaching $2,028.25 per ounce after hitting its lowest point since January 25 in the previous session.
Investors and analysts are closely monitoring these developments, with an eye on how global economic indicators and central bank decisions will shape the trajectory of gold prices in the coming weeks.
The UAE’s gold price surge reflects the intricate dance between economic data, inflation concerns, and expectations regarding central bank policies.
As the world navigates through uncertainties, gold continues to assert its role as a barometer of market sentiment and a safe-haven asset in economic flux.
In conclusion, the recent rebound in gold prices in the UAE underscores the delicate balance investors must strike in response to changing economic conditions.
The market’s keen attention to US economic indicators and central bank decisions highlights the interconnectedness of global financial markets and the importance of staying vigilant amid evolving trends.
This article was created using automation technology and was thoroughly edited and fact-checked by one of our editorial staff members